BUILDING

OPERATIONAL
RESILIENCE
A CASE STUDY OF NISSAN MOTOR COMPANY LTD.

▪ SYED HARIS HASHMI, 20201-27798

▪ SYED ABDULLAH, 20201-27658
▪ ABDUL KABIR KHAN, 20201-27631
▪ HAMZA ASAD, 20201-27923
▪ IBTEHAJ NADEEM, 20201-27813
TABLE OF CONTENT

● Introduction
● Overview of Automotive industry
● The Earthquake of 2011
● Impact on Industry
● Nissan’s Supply Chain Philosophy
● A Focus on Flexibility
● Risk Management
● Nissan’s response to the disaster
● Nissan’s recovery Committee’s practices
● Going forward
NISSAN MOTOR
CORPORATION LIMITED

Nissan Motor Corporation and

often shortened to Nissan is a
Japanese multinational automobile
manufacturer headquartered in
Nishi-ku, Yokohama, Japan. The
company sells its vehicles under
the Nissan, Infiniti, and Datsun
brands.

Nissan was the sixth largest

automaker in the world, after
Toyota, General Motors,
Volkswagen Group, Hyundai Motor
Group, and Ford.
OVERVIEW OF JAPANESE AUTOMOTIVE INDUSTRY

Toyota Nissan Honda Suzuki Others

Others Toyota
30% 36%

Suzuki
11%
Honda Nissan
11% 12%

Annual Production Share of OEMs in Japan

THE EARTHQUAKE OF 2011: 3 DISASTERS IN 1
9.0-
MAGNITUDE
TSUNAMI
EARTHQUAKE

Among the five most Waves 40 meters high

powerful on record traveled up to 10
Coast of Japan kilometers inland

NUCLEAR
EMERGENCY LOSSES

Level 7 meltdowns at 25,000 people dead,

3 nuclear reactors missing or injured
125,000 buildings
damaged ¥16.9 trillion
 EARTHQUAKE’S IMPACT ON AUTOMOTIVE
INDUSTRY
1 2 3 4 5
80% Japanese Monthly production Product availability in Overseas production Nissan suffered damage to
Automotive plants dropped nearly 60% export markets affected as over 20% six production facilities and
suspended affected parts sourcing was about 50 of its critical
Production from Japan suppliers were impaired.
Fire breakouts, Engine
damages, Lithium-ion
battery damages
 EARTHQUAKE

IHS GLOBAL INSIGHT, A GLOBAL

CONSULTING FIRM, FORECASTED
THAT OVER 4 MILLION UNITS OF
VEHICLE PRODUCTION WILL BE
LOST BECAUSE OF THE
DISASTERS IN JAPAN, WITH 90%
OF THEM FROM JAPANESE
AUTOMAKERS.
 NISSAN’S SUPPLY CHAIN PHILOSOPHY
Before disaster: Regional,
decentralized supply
chain structure
After disaster: Imposed
strong central control
and coordination

• Nissan’s corporate officers represented a range of nationalities (not present in other OEMs)

• Nissan considered this diversity to be a source of strength in managing a large global operations
 RISK MANAGEMENT AT NISSAN, HISTORY
Risk Nissan agreed to
Resolved after buy into Renault
management
alliance with when it was
became critical
Renault financially able
in 1999
to do so

The company Renault bought Nissan’s risk

faced severe 36.8% of Nissan’s management
financial outstanding philosophy was
stock and born out of its
difficulties
near-death
experience.
RISK MANAGEMENT AT NISSAN
NISSAN’S RESPONSE TO THE DISASTER

Adhered to the Nissan’s Global Disaster A Recovery Committee

principles detailed in its Control Headquarters was established to
earthquake was to evaluate the coordinate the global
emergency-response impact on operations and recovery actions
plan to oversee the
restoration of activities
THE RECOVERY COMMITTEE’S PRACTICES
THE RECOVERY COMMITTEE’S
PRACTICES: SHARING INFORMATION
THE RECOVERY COMMITTEE’S
PRACTICES: ALLOCATING SUPPLY
THE RECOVERY COMMITTEE’S
PRACTICES: MANAGING PRODUCTION
THE RECOVERY COMMITTEE’S
PRACTICES: EMPOWERING ACTION
GOING FORWARD

1 PRODUCTION

Nissan announced that it would increase the localized

production of its cars in the Americas from
approximately 70% to 90% by 2015.

2 COMPONENTS

Target to reduce its reliance on Japanese-made components in its foreign factories

3 SUPPLIERS

Effort to better understand critical dependencies that exist

within its supply chain beyond the first tier of suppliers
THANK
YOU